­Cordoned off by police riot vans, the crowd outside the government headquarters in Madrid yelled slogans lambasting further austerity measures and political corruption, demanding the resignations of the deputies of both the ruling conservative Popular Party and the opposition Socialists.

"People in the street feel like [lawmakers] don't respect us," Noelia Urdialesa, a care assistant, told the AFP. "They are making cuts in health and education, affecting the most vulnerable."

Earlier in the day, students also staged an anti-austerity protest against new cuts to education that are expected in the 2013 budget, which will lead to larger class sizes and higher tuition fees.

Approximately $6.5 billion has been cut from education funding in Spain since 2010.

Politicians, meanwhile, are debating a new budget plan that would add an additional €39 billion in savings, as part of the plan to reduce spending by €150 billion between 2012 and 2014 with pay cuts and tax rises.

Speaking at the start of the debate, Finance Minister Cristobal Montoro said the draft budget "aimed to combat the crisis," adding that it was a budget that would make "2013 the last year of recession for Spain."

But people outside do not believe that reaching such targets is even a remote possibility.

“Those deficit targets are impossible to meet. Everybody knows that, so the government is counting on the EU to ease those targets. But the problem is that easing the targets does not mean that the government will ease their austerity policies,” journalist Miguel-Anxo Murado told RT.

This is very difficult, as Spain’s economy continued to shrink in the third quarter, according to central bank estimates Tuesday. This is the fifth quarter in a row that Spain's economic output has shrunk.

In late September during similar protests, 38 people were arrested and 64 injured when officers clashed with protesters demonstrating against austerity cutbacks and tax hikes.

This time, no casualties have been reported.

More protests outside Parliament are planned for Thursday and Saturday.

Demonstrators gather outside Parliament as the debate for the 2013 budget goes on inside Parliament in Madrid October 23, 2012. (Reuters/Susana Vera)

A demonstrator (C) wearing a Guy Fawkes mask does the Nazi salute as he holds a placard depicting a EU flag with a swatiska in his centre as he takes part in a protest against government's austerity reforms and the public payment of bank's debts on October 23, 2012 in Madrid. (AFP Photo/Dominique Faget)

AFP Photo/Pierre-Philippe Marcou

Reuters/Susana Vera

A demonstrator holds a banner reading in Basque "ETA inmates and fugitives back home" during a demonstration against government's austerity reforms and the public payment of bank's debts on October 23, 2012 in Madrid. (AFP Photo/Pedro Armestre)